On Monday night, the Solvang city council voted 4-1 to restructure the city’s water rates and sewer rates, and to raise overall revenue by up to 5.25% each year for the next four years.

The public was given an opportunity to formally protest the rate change but at the end of the public hearing, the protest against water and sewer rate changes only numbered 88 and 45, respectively. This was far from the 975 protest it would have taken to halt the council’s action.

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The new rates go into effect on Nov. 21 and when they do, residents may see dramatic increases while others may see their bills go down. This is due to a new rate structure that seeks to ensure each Solvang resident is paying his or her fair share of the water bill. The new rates were imposed to lift both the water and sewer funds out of deficit that threatened their liquidity.

Still, for those with meters above the standard size (5/8 inches) that means changes that could be painful to their wallets. Some of those due for a rate increase spoke Monday and voiced displeasure with the proposal.

Richard Christensen told the council he expected his bill to shoot upward in November. “I’m here again to protest the water rate increase, including its applicable formulas. I believe your advertised rate of 5.25% is very misleading. In my case alone, and I’ve checked with other cases, the 1-inch meter would increase 3.8% the first year, 49.6% in the five-year period. This is far in excess of the projected and advertised 5.5% increase.”

Another complaint about the changing rate structure came in the form of a letter from Nancy Orchard, read into the record by Solvang mayor Jim Richardson. In that letter, Orchard estimated the cost to ratepayers with 3/4 inch meters could go as high as 53% and that residents with 1-inch meters might be due for an increase of 71%. She noted that the fix charge for a hotel with a 3-inch meter and 120 rooms would drop by 49%.

Orchard called on the council to, “assemble a group of local volunteer accountants, engineers and math teachers to review these water rate increases and decreases before adopting them.” At least two more speakers before the council complained that the new rates were confusing and seemed alarmingly high. Richardson asked city manager Brad Vidro to explain why some users might be getting a decreased water bill while others saw their rates go up.

“As we’ve said from the beginning of this, we are not only putting an annual increase on the rates, but we are also adjusting the rate structure,” said Vidro. “The size of the connection or meter, the 5/8, the 3/4, each of those exponentially requires us to provide more water to the property. In the past, it has not been a fair distribution. We have a high distribution of 5/8 meters and they have been carrying a heavier burden of the total cost of the system.”

He said the new fixed fees were capacity based and corrected inequalities in the previous system. The city staff did not directly comment on the numbers presented by the public, but Vidro said “considerable increases” could be expected for users with larger meter sizes. He said after the initial adjustments, that everyone’s water bill would rise by the 5.25% outlined in the rate change.

Councilman Hans Duus questioned Vidro about the equity between commercial and residential fees. Vidro said, “It’s the same logic, what has happened is some of the commercial has (unfairly) been paying more. They have been subsidizing the residential side.” Under the new rate structure, fixed charges for business are only billed according to meter size. The old system used to take into account factors like number of seats, but that was done away with.

City attorney Roy Hanley told the council that under California’s Proposition 218, each water customer had to pay his or her share of the burden on the water system. He said the new system of rates brought the city into compliance with that proposition. “You can’t burden one user’s more than their demand on the system,” he said. “The people who did the study really took a look at that and made sure we got it right. It turned out that people with smaller meters prior to this study were paying more than their share.”

One person spoke in favor of the rate changes at the meter. Former mayor Willy Campbell said the blame for Solvang’s high water rates did not lie with a single person or council. She stressed the importance of keeping both the water and sewer funds operational. Campbell explained that both funds were enterprise funds and, as such, could not be rescued with general fund money.

“The only people who pay for sewer and water are the people who use sewer and water. We do this because we want to supply water every time we turn on the faucet. The choice is yours, dear ones – you cannot let the enterprise funds run on credit,” she said.

After adjourning to count the protests, the council resumed its discussion. When it came time to vote, the lone “no” on the bench came from Duus, who said he supported restructuring rates but opposed raising revenue by 5.25% in the first year. He reasoned that a rate closer to 2% would be better for residents already struggling in the tough economy.